June 18: E-commerce major Flipkart has settled a legal dispute with an Indian startup that had alleged that it went through a financial crisis after Flipkart gave huge discounts on the company products.
Indian startup GOQii that sells smartwatch-type health devices approached a Mumbai Court alleging that the company products where sold on 70% discount. As a temporary measure, the court ceased the sales of the device on Flipkart.
On June 14, the companies released a joint statement in which they said that the issue has been resolved and Flipkart will continue selling GOQii health devices. The companies did not disclose the settlement course.
Vishal Gondal, CEO of GOQii has been quoted as saying that the e-commerce company has agreed on a resolution benefiting both the brand and the customers, said that they are withdrawing the case filed against Flipkart.
Recently, the small scale traders and the right-wing group closely related to the ruling party raised concerns that the e-commerce company burns billions of dollars by offering huge discounts on many products.
According to GOQii, they had signed an agreement with a Flipkart unit. As per the agreement, the company can sell two of its devices at a price not lower than Rs 1,999 ($28.63) and Rs 1,499 on Flipkart. Later the company found out that the product is being sold for Rs 999 and Rs 699 on the e-commerce site.
Flipkart has said that it reserved the right to institute actions for defamation, both civil and criminal. They also stated that the site is not responsible for the discounts but the third-party firms which sell via its website is. The company concluded the legal dispute on a friendly note. Flipkart stated that they have assured constant engagement with GOQii to solve the dispute.
In 2018, with a market share of 19% in India’s so-called wearables market, GOQii became the second largest seller in the industry. The wearable market is dominated by the Chinese company Xiaomi.